The 32 savviest money men and women who guide stars and executives in boosting their income, cutting their taxes and watching out for those questionable investments.
Artists and executives know that making money is only half the challenge. They look to business managers for guidance in how to best spend, save or invest that cash and, frankly, shield their income from taxes (legally, of course). But following the money has never been more complicated, particularly as physical CD sales and downloads from iTunes have given way to Spotify, Amazon and Apple Music.
“Getting paid from streaming continues to be a mystery and a challenge,” says Bernard Gudvi, longtime business manager for Tom Petty, echoing the view of many colleagues. “Every day we’re trying to understand it better.”
Revenue also flows from more varied sources than ever, with branding and sponsorship deals, for example, rivaling traditional income from music publishing and touring.
For money managers, one thing never changes: the need to caution high earners from investing in unusual, and often risky, ventures: restaurants, ranches, medical-marijuana farms -- or even their own private islands. Says Nashville-based adviser Al Hagaman: “You can only imagine the challenges that come with buying a rock in the middle of the ocean.”
Louis Barajas, 56 Founder/CEO, Business Management LAB
Barajas worked for 20 years with underprivileged Latin residents in East Los Angeles before applying his financial know-how to entertainers, with a focus on estate planning; Jenni Rivera was a client before her death in 2012. “No one dies on my watch without taking care of their kids, family and fans,” says Barajas, a father of three, whose client list also includes Nicky Jam and Yandel, labels such as Gerencia 360 and executives like Pepe Garza. With proper estate planning, he says, “there’s a sense of security and peace.”
David Bolno, 40 Partner, Nigro Karlin Segal Feldstein & Bolno
Richard Feldstein Partner, Nigro Karlin Segal Feldstein & Bolno
“On average, our [tax] strategies save each client between $1 million and $2 million a year,” depending on circumstances, says Bolno, who represents Pharrell Williams and Drake, among others. This year, Bolno executed a nine-figure transaction with a private-equity firm on behalf of one client, the largest deal of his career. Karlin, in the 36 years since he co-founded the firm, has earned the loyalty of veteran acts like Van Halen, which has been his client since 1979. “I believe in stacking chips and being conservative,” he says. “Keep accumulating. Be smart. Be realistic. An 8 percent annual return isn’t so bad, and 10 percent is fantastic.” Segal this year helped one client defer half of a $100 million tax bill for 12 months. He tells clients they can’t go wrong if they follow one simple rule: “If you only spend 40 cents for every dollar you make [after taxes and commissions, before savings and investments], you’ll never be in financial trouble.”
Julie Boos, 48 Jamie Cheek, 47 Duane Clark, 47 Mary Ann McCready Carmen Romano, 53 Flood Bumstead McCready & McCarthy
The advisers at Flood Bumstead McCready & McCarthy forgo formal titles, but their collective expertise has drawn clients said to include Blake Shelton, Keith Urban and Clint Higham, who represents Kenny Chesney. (The firm declines to confirm its roster.) “Our achievements are our clients’ achievements,” says Boos, “watching them achieve their goals [and] financial independence.” One way of doing that, says Clark, is to keep advice clear and simple. “I had a wise man tell me one time that if you can’t explain an investment in 30 seconds, [your client] should run for the hills.” Romano urges artists “to develop [smart] spending habits” in their early years, while McCready thrives on mentoring young people both in the music business and at her firm. For Cheek, FBMM’s recruitment of younger advisers has been one of the firm’s most important priorities, he says, “to ensure our clients would have representation well beyond the career of any one person.”
Peter Fairley, 68 Partner, CohnReznick
Fairley, a native of Northern Ireland who now lives and works in Manhattan, has accounting credentials in England and Wales as well as the United States. On behalf of his clients from abroad touring within the United States, he negotiates a central withholding agreement so that the IRS doesn’t automatically hold on to 30 percent of their earnings, “which can wreak havoc with a tour’s cash flow,” he says. His best advice? “Keep working, stay hungry, don’t get lazy -- and listen to your business adviser.”
W. Eric Fulton, 54 Founder/managing partner, Fulton Management
“Don’t buy a plane, invest in a restaurant or put all your money into a new weed farm, which seems to be the flavor of the month right now,” says Fulton of three common but questionable investments. The Calabasas, Calif., native -- who works with Hall & Oates, Colbie Caillat, Meat Loaf and Seether -- advises clients to “control spending and budget your cash accordingly.” He also closely watches the tax impact of international tours by U.S. musicians. “You can end up with a whole lot of foreign tax credits that go unused and have to be carried forward,” he explains. “We told one client to do some shows in Mexico, although it’s not [paying] as much as the client would make on tour in the U.S. -- but it would free up a whole bunch of tax credits.”
William Harper Jr., 60 Partner, Gelfand Rennert & Feldman
Stanley Lim, 47 Partner, Gelfand Rennert & Feldman
Ronald E. Nash, 58 Partner, Gelfand Rennert & Feldman
David Phillips, 49 Partner, Gelfand Rennert & Feldman
Philanthropy -- both by the firm and its clients -- is top of mind at Gelfand Rennert & Feldman as it celebrates its 50th anniversary in 2017, representing stars said to include Bob Dylan. (It does not confirm its roster.) With 330 employees in five offices around the globe, the company started by Gelfand’s father is donating to programs at 50 schools. “The employees are driving it,” says Gelfand, a father of three and grandfather of two. And the firm is working more closely than ever with clients to facilitate their giving, from one-time donations to setting up trusts and estate planning. “It was an interesting year to be looking at philanthropic giving and making sure we are on the cutting edge,” particularly in the area of tax planning, says Gelfand. “It’s very rewarding to see our clients who have been blessed with great success being extremely charitable.”
Bernard Gudvi, 70 Partner, GSO Business Management
When the charity organization MusiCares paid tribute to Tom Petty the night before the Grammy Awards last February, those gathered included Stevie Nicks, Randy Newman, Jackson Browne -- and Gudvi, who has counted Petty among his clients for 35 years. “That felt very personal, to be part of that recognition,” says Gudvi, a son of Holocaust survivors, who has worked with musicians for over four decades. One oft-repeated bit of advice: “I try to discourage [using] private jets,” he says, “but clients who can afford it are going to do it.”
Al Hagaman Jr., 64 Co-founder/member, O’Neil Hagaman
Hagaman says that the best business managers take a holistic approach, stressing financial and emotional discipline. “Mind, body and spirit -- if you don’t maintain a balance in your life in all of those areas, it can lead to bad decisions,” he says. Tim McGraw and Faith Hill are among those known to get guidance from this Nashville firm (which doesn’t discuss its clients). Harris has the same advice for superstars as she does for civilians: “Stick to balanced portfolios -- things we all understand,” she says. New clients get the basic primer: “Don’t accumulate debt,” says Harris. “Pay for as much as possible in cash, as you earn it. And stay current on your taxes.” The most successful artists want to be their own CEOs, says O’Neil. “We can’t make the decisions for you. We can only educate you so that you can make decisions that reflect your goals.”
Michael Kaplan, 46 Partner, Miller Kaplan Arase
After starting his career at Ernst & Young, where he specialized in tax consulting, Kaplan in 1996 moved to the firm (that his father had joined in 1961) and built the business management group. “We’ve set ourselves up as a one-stop shop for the music industry,” says Kaplan, who doesn’t divulge his client list. The Los Angeles resident says the firm has evolved with artists’ needs: “At the beginning, we offered tax services, then built out the licensing and royalties group and dealt with branding. We can be everything to the client.”
David Levin, 59 CEO, DL Business Management
New York-based Levin sees himself as a “CFO” for his clients, who include John Legend, Chrissy Teigen, Jessica Simpson and the band Live, offering expertise in evaluating endorsements and business acquisitions. Working with his clients’ management teams, the father of two helped structure Legend’s 2017 world tour; guided Teigen’s deals with Vita Coco, TRESemmé and Samsung; and saw Simpson expand her brand into bedding and children’s clothing. An emotional high point of Levin’s year was the reunion of Live, a band he began representing in 1991, and its tour, which included three dates opening for Guns N’ Roses.
Matt Lichtenberg, 59
Partner, Level Four Business Management
Lichtenberg’s clients include top comics Larry David and Will Ferrell, producers such as Brendan O’Brien and record executives Ron Fair and Mark Williams. But a top achievement for any business manager, he says, is not being recognized for achievements. “Our job really is to stay under the radar,” say the Los Angeles resident, who began his career at Price Waterhouse in the 1970s. “Anybody in our business who thinks they’re the star shouldn’t be in our business.”
Lawrence Rudolph Executive director, FFO
An international tax attorney who grew up in South Africa, Rudolph has been associated with top executives such as Jimmy Iovine of Apple Music. (He declined to confirm his firm’s roster or be interviewed for this report, citing client privacy.) He joined FFO in 2015, when the company merged with Capell Rudolph, his Los Angeles-based business management firm. Previously, Rudolph has said that the top money management mistake artists make is “not staying within budget and having insufficient funds in reserve to go through the slack times.”
Back when artists were selling CDs, says Smallwood, it was comparatively easy to track earnings by counting albums sold. With the array of digital music platforms, “it has become difficult, if not impossible, for us as business managers to make sure our clients are properly compensated,” says the Atlanta resident. “It’s a huge problem.” But less so for Smallwood’s marquee client, Justin Bieber. In addition to his income from CD sales and streaming, Bieber’s 2016-17 Purpose Tour grossed $250.6 million, according to Billboard Boxscore -- counting each and every one of its 2.8 million tickets sold.
Lou Taylor, 51 CEO, Tri Star Sports & Entertainment Group
After running her business management company for 24 years, Taylor measures her recent success with six words: Las Vegas, Britney Spears, Jennifer Lopez. Spears’ four-year Piece of Me residency at Planet Hollywood has reported grosses of $116.2 million to Billboard Boxscore through May, selling over 795,000 tickets, while Lopez’s residency has scored more than $50 million through June. “We run and anticipate clients’ lives like a Fortune 500 company,” says Taylor, who started out at the accounting firm Arthur Andersen, where she was one of only two employees who knew how to use the office computer. “You sit and measure the risk and decide what’s the growth.”
Mike Vaden, 64 Principal, Vaden Group
Keeping his clients out of trouble is the primary concern of Nashville-based Vaden, whose company is a division of accounting firm Elliott Davis Decosimo. “Everybody thinks they have a way to not pay any taxes on the money they make,” he says with a laugh. Discretion about his clients is an important part of his business, but he got his start working with Johnny Cash and Waylon Jennings and now advises everyone from “brand-new artists to old staples that are still out there.” A major coup in 2017 was orchestrating the donation of 400 acres of land to a charity, saving a client $3 million in taxes.
Bill Vuylsteke Senior managing director/co-owner, Provident Financial Management
“I say no to clients when they want to invest in restaurants and things that float and fly,” says a prudent Vuylsteke, whose clients include international touring artists and “other high-net individuals.” A Swiss native who grew up in San Francisco and lives in Los Angeles, Vuylsteke describes his work as an ongoing balance between “helping creative minds accomplish their goals while maintaining financial stability.” This has meant cautioning clients on investments ranging from sunken treasures to vineyards to apps that “never make money.”
David Weise, 50 Managing partner, David Weise & Associates
With staff focused on touring and royalty management, Weise brings a veteran’s expertise to managing the business affairs for artists like The Weeknd, Jack White, Carole King and deadmau5. For his younger clients, “the challenge is to effectively manage their expectations and try to keep their feet on the ground,” says the Westlake Village, Calif., resident and father of two teenagers. In 2017, Weise and his team formalized procedures to help clients work in the states that don’t have an income tax, cutting their annual taxes by 10 to 13 percent.
Kris Wiatr, 45 President, Wiatr & Associates
From veteran rocker Mick Fleetwood to newer country stars including Chris Stapleton, Maren Morris and Lee Brice, Wiatr celebrates his clients’ successes. “It can be as simple as paying off a home, or as complex as confirming a stadium tour alongside a brand partnership,” says the Kentucky native, who set up his Nashville firm in 2009. “I love seeing them reach their lifelong dreams. Their wins are our wins.”
Victor Wlodinguer, 64 Partner/practice leader, music business management, Citrin Cooperman
Q Prime, the powerhouse management firm co-founded by Peter Mensch and Cliff Burnstein, represents acts such as Metallica and Eric Church, and for 30 years the company has turned to Wlodinguer for financial guidance. Born in Argentina and raised in Queens, Wlodinguer runs a boutique practice within Citrin Cooperman that also represents groups like Interpol, Kaiser Chiefs and Thievery Corporation. Clients “have to understand what they can and can’t spend, and make sure they save some money,” he says. For his own portfolio, Wlodinguer has placed bets on the digital future. “I invested a small amount of money in Bitcoin,” he says. “I did well.”
Contributors: Cathy Applefeld Olson, Leila Cobo, Chuck Dauphin, Thom Duffy, Adrienne Gaffney, Andy Gensler, Steve Knopper, Robert Levine, Gail Mitchell, Melinda Newman, Alex Pham, Deborah Wilker
‘OUR JOB IS TO SUPPORT OUR CLIENTS' GOALS’
But business managers also must be the voice of fiscal reason, says RZO’s Zysblat.
"The last year was bittersweet in many ways,” says Bill Zysblat. “I lost my friend of 45 years and partner of almost as long, Joe Rascoff. As we still say, ‘The R in RZO.’ ” Rascoff died April 6 at age 71.
The father of three grown children, who lives on the Upper West Side of Manhattan with his wife, Dr. Laura Sirulnik, a psychiatrist, Zysblat, 62, offers his views on RZO, touring costs and the challenges of business management -- while carrying on his partner’s legacy.
RZO’s roster: “We made the transition of representing David Bowie to representing his estate. At the same time, we welcomed new clients David Letterman and Lady Gaga. There is nothing more gratifying than when an artist at the top of their game chooses to come to you.”
Most recent splurge: “A good tour production manager.”
Favorite bargain: “A good tour production manager.”
Money mistakes to avoid: “Expensive short-term gratification. Purchase of a private plane. Believing the success will never end. It might not, but that can’t be your long-term plan.”
Biggest challenge: “I could talk about the changing industry, the virtually complete loss of recording royalties or even foreign exchange swings all impacting client earnings. But truthfully, the biggest challenge is controlling clients’ financial expectations without leaving them with a sense that they are not believed in or supported. It is our job to be pessimists and plan for the worst while hoping for the best. But clients often look at our caution as a lack of support. Of course, nothing could be further than the truth. Our job is literally to support our clients’ artistic goals. But equally important is our being the voice of reason with a long-term view of maintaining a particular lifestyle for decades to come.”